Yellen says Beijing’s rapid buildout of its green energy industry ‘distorts global prices’

U.S. Treasury Secretary Janet Yellen

Treasury Secretary Janet Yellen called out China’s ramped-up production in solar energy, electric vehicles and lithium-ion batteries, calling it unfair competition that “distorts global prices» and “hurts American firms and workers, as well as firms and workers around the world.”

Yellen, who is planning her second trip to China as Treasury secretary, said yesterday [Macau time] in Georgia that she will convey her belief to her Chinese counterparts that Beijing’s increased production of green energy also poses risks “to productivity and growth in the Chinese economy.”

“I will press my Chinese counterparts to take necessary steps to address this issue.”

China is the dominant player in batteries for electric vehicles and has a rapidly expanding auto industry that could challenge the world’s established carmakers as it goes global. The International Energy Agency, a Paris-based intergovernmental group, notes that in 2023 China accounted for around 60% of global electric car sales.

Yellen delivered remarks at Suniva — a solar cell manufacturing facility in Norcross, Georgia. The plant closed in 2017 in large part due to cheap imports flooding the market, according to Treasury. It is reopening, in part, because of incentives provided by the Democrats’ Inflation Reduction Act, which provides tax incentives for green energy manufacturing.

The firm’s history is something of a warning on the impact of oversaturation of markets by Chinese products — and a marker of the state of U.S.-China economic relations, which are strained due to investment prohibitions, espionage concerns and other issues.

China this week filed a World Trade Organization complaint against the U.S. over what it says are discriminatory requirements for electric vehicle subsidies. MDT/AP